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A Conservative Capitalism worth ﬁghting for

1st October 2017

With our political order now under attack from the extremes of both left and right, a new battle of ideologies is reshaping our politics. Is it too late to restore trust in the political centre ground?

For those of us committed to the OneNation Conservative cause we need to man the intellectual barricades.

Let's not be in any doubt about the scale of the challenge ahead. As this week's damning report from the Legatum Institute shows, popular support for capitalism, especially amongst the Millennial <40 generation, is strained to breaking point.

When asked, only 8% of the public now believe capitalism ‘delivers for most people’ and only 7% believe capitalism works ‘for the greater good’. Meanwhile, only 15% of people associate the word ‘dangerous’ with socialism, whereas 18% of people now do so with capitalism. Read those numbers again and reﬂect.

Even when it comes to policies like Nationalisation - a debate many thought had been settled decades ago - Legatum found that over 75% of the public now support renationalising water, gas, electricity and railways. Popular support for capitalism in Britain in 2017 has been exhausted. We need to ask why. And come up with distinctive Conservative policy alternatives (like mutual Regional Rail Companies owned by the users, instead of ReNationalisation).

It's clear we are witnessing a long-incubated but now rapidly deepening erosion of trust in the foundations of our current political economy: that subtle but essential public trust in the legitimacy of the relationship between power and wealth in our society. Free trade, open markets, even the demonstrable ability of enterprise economics to raise living standards for the many not the few - all of it is now being questioned by a generation of citizens who have been hard hit by the legacy of the Great Crash: the bank bailout, seemingly endless cuts to the public sector frontline, incomes squeezed, and now a divisive Brexit.

We need to make this a moment to unleash a more empowering capitalism that works for everyone - a robust and insurgent economics which radically empowers citizen consumers by busting open the all-too-cosy ‘cartel capitalism’ of the near monopolies we've allowed to dominate markets like banking, utilities and house building. If we don't, Comrade McDonnell will take this as the moment to wield the Marxist wrecking ball with the insurrection he has long dreamed of.

This is not inevitable. It's up to us. If we seize the moment to respect and tackle the source of people's anger, we can see this off.

How? Here are some things we could do. Now. Which don’t need legislation.

First, it is essential that we respect and tackle the grievances Jeremy Corbyn has harnessed. Whether it is housing, tuition fees or public sector pay, we must listen and we must acknowledge.

Responding by blaming Labour and offering managerial tweaks isn’t enough. We need to be bold.

Second, we must recognise that inter-generational fairness is the major issue of our time, bigger than Brexit and with consequences that could be even more profound. Unaddressed, we risk an entire generation under forty rejecting not just Conservatism but capitalism too. We need to think boldly about a New Deal for the Millennial generation that reﬂects their need for an affordable home, to save and accumulate capital and a new model of ‘National Insurance’ that actually offers them something long term.

Third, we must end the lazy and hugely damaging ‘apartheid’ between the public and private sectors too dominant in too much Conservative language. To get out of this postcrash debt trap we need both to ﬂourish. Both have much to learn from the other. We must back those who choose public service, and champion our best public service leaders. That doesn’t mean turning on the taps like Corbyn. If that’s the answer people will vote for them to do it. It means bold new incentives to accelerate innovation, through a new model of “public service enterprise” where beneﬁts of reforms are retained within the service. Endless top down, command-and-control Whitehall austerity which takes savings off the most productive to ﬁnance the failing is destroying goodwill.

Fourth, we have to rediscover our passion for political debate, show we are listening, stop lazily assuming everyone remembers - or cares about - the 1970s, and engage in the battle of ideas now raging in 2017. Anyone who grew up during the dark days of 1970s socialism know the consequences of that well-intended but ﬂawed idealism. It doesn't work. But a new generation of people under forty only know the failures of the 90’s: the spin, dodgy dossiers, cash-for-peerages and MPs’ expenses scandals, and the bank bailout. While we must be bold in reforming failing markets, we must also be bold in setting out WHY socialism has always failed the poorest. The arguments don't make themselves.

Fifth, we need to unleash and champion a new spirit of positive, compassionate, generous, inspiring enterprise to shake up failing markets, expand the shareholder base, and give millennials a stake in their future. Unless we show a zeal to tackle market failure and make markets work for everyone in 2017, we risk alienating a whole generation not just from Conservatism but from capitalism. We need to champion the creative, empowering anti-establishment spirit of entrepreneurialism - in the private and public sectors, in commercial and social enterprise. We need to celebrate the ‘spirit’, values and character of inspired compassionate conservatism: the monopoly-busting, growth-enhancing, job-creating power of enterprise. Voters want to know whose side we are on. We need to show them.

In all our deﬁning periods, whether on Free Trade, Poor Law reform or Disraeli’s mass enfranchisement in the 19thCentury, or Churchill, Butler or Thatcher’s reforms in the 20th, Conservatism has never been about blindly defending a failing status quo, but championing the generational disrupters who see the future and reshape our politics and economy towards it.

Finally, we need to be bold in showing we have learnt the lessons of this years election manifesto and campaign ﬁasco and embrace grassroots Party reform. With Conservative membership falling fast we need to reboot the way we reach out to the Young and Millennial generation. Never again should we lazily and cynically assume that Labour voters who voted Brexit will therefore support us regardless. It was an insult. If Brexit doesn't become a moment of profound national renewal for a New Generation, it will fail. And deserve to.

This all demands new thinking. That’s why a team of us launched the ﬁrst BigTent IdeasFestival and the new Capital Ideas Foundation last week: to energise the intellectual and cultural ﬁghtback for a reforming OneNation Conservatism, setting out how a programme of bolder innovation can renew the ties that bind us beyond Brexit. To transform our public services until they are the envy of the world. To trigger a new cycle of growth and skill training in our economy. To make Britain a global crucible of the innovation the world urgently needs, exporting our science, technology, products and services to the fastest growing markets in the world. Most of all, to reset a contract of citizenship - for people here in the U.K. and for Britain as a citizen in the world - that we can all be proud of.

The hard left doesn’t have a monopoly on passion, ideals and hope. But they do see state power as the answer to every grievance and the realisation of every fantasy. We must counter this. And fast. We must better explain and share the astonishing achievements of our enterprise economy over recent decades and propose a fresh, commonsense capitalism of citizen empowerment to a post-Crash generation.

To be in ofﬁce at such a moment is a privilege, not a right. This is no time for our party to indulge in bickering, or a divisive Brexit civil war. Let us demonstrate that we remain as hungry to reform our country as we did when we entered ofﬁce seven years ago, and as visionary and impatient as the PM's speech on entering No10. This is what we came to politics for, isn't it? Future generations will not judge us kindly if we fail.

George Freeman MP

Chair, the Prime Minister's Policy Board

Chairman, the Conservative Policy Forum

Big Tent Ideas Festival

Politics is undergoing a tectonic shift. That’s why this year I launched the first-ever Big Tent Ideas Festival, aiming to tackle the most difficult policy challenges we face. Bringing together over a hundred thinkers across the political spectrum, we discussed new ideas on everything from Brexit to intergenerational fairness, centred around three main themes: Politics, Society and Economy.

The Big Tent Ideas Festival is part of the new Capital Ideas Foundation, and will be setting off round the country over the next twelve months as the forum for the best new ideas in public policy. Click below and join us.